New Proposal: Changes to Staking Reward Timing on KILT
A proposal has been made on KILT to change staking rewards from an automatic distribution to a timeframe selected by recipients. Collators and delegators could choose a time that best suits them to claim (such as once a week, once a month, once a quarter, once a year), which will significantly simplify tax reporting.
Under the current setup:
- Rewards for collators and delegators are issued every time a block is built, adding to the load on the blockchain.
- Each reward payout is an income event for collators and delegators, potentially creating thousands of taxable income entries for each account during one year.
To address these issues, a new proposal was submitted for community vote to change reward distribution from an automatic to a pull-based function. This would reduce the computation needed for each block, and make tax reporting easier for delegators and collators.
There would be no change anticipated for those staking KILT Coins on exchanges.
All KILT Coin holders can vote on the proposal and you can even use your staked coins for voting. Join the discussion on the proposal here. It is anticipated that the proposal would go to referendum on Wednesday November 23, with voting open for 7 days until November 30. If approved, the changes would be enacted automatically on December 1st.
The change to staking would be carried out as a runtime upgrade, allowing services to run normally on KILT except for a few minutes of maintenance on Stakeboard.
How to Claim Rewards
If the proposed upgrade is approved and enacted, rewards will be continually counted but no longer automatically paid out to the wallet. The rewards will be visible on Stakeboard as “unclaimed rewards”.
Clicking “Claim” on Stakeboard uses the counter to calculate the reward and move it from the blockchain into the wallet it was staked from. Since this process is recorded on the blockchain it requires a small transaction fee (around 0.0002 KILT total).
Collators and more tech-minded users can also check their rewards and claim via Polkadot JS Apps. See KILT technical documentation for more details.
KILT is a blockchain identity protocol for generating decentralized identifiers (DIDs) and verifiable credentials, providing practical, secure identity solutions for enterprise and consumers.